Tenet Healthcare Analyst Conference Call Summary Company Overview - **Company**: Tenet Healthcare (NYSE: THC) - **Date of Call**: February 02, 2026 - **Key Participants**: - Will McDowell, Vice President of Investor Relations - Saum Sutaria, Chairman and CEO - Sun Park, Executive Vice President and CFO Core Industry Insights - **Industry**: Healthcare, specifically focusing on revenue cycle management through Conifer, a subsidiary of Tenet Key Points and Arguments Financial Performance and Transactions - **Fourth Quarter 2025 Adjusted EBITDA**: Expected to be at the upper end of the previously provided guidance, driven by strong same-store revenues and disciplined expense management in hospitals and USPI [3] - **Conifer Transaction**: - Closed an asset sale regarding Conifer's Revenue Cycle Management Services contract with CommonSpirit valued at **$2.65 billion** [4] - Transaction includes cash payments, reduction of liabilities, and acquisition of an additional **23.8% equity stake** in Conifer [4] - Represents an approximate **14x multiple** on the impacted 2025 Adjusted EBITDA less NCI [4] Transaction Mechanics - **Revenue Cycle Services**: Conifer will continue to provide services to CommonSpirit through the end of 2026, maintaining expected adjusted EBITDA of approximately **$190 million** for 2025 [5][6] - **Financial Terms**: - CommonSpirit to pay **$1.9 billion** to Tenet over three years, with **$540 million** due in Q1 2026 [7] - Tenet will pay **$540 million** to CommonSpirit to redeem their equity stake, effective January 1, 2026 [8] - Anticipated reduction of **$100 million** in NCI expenses in 2026 due to the transaction [6] Strategic Control and Future Investments - **Strategic Control**: The transaction returns full strategic control of Conifer to Tenet, allowing for focused investments in automation and AI to enhance operational efficiency [10][11] - **Investment Focus**: Emphasis on offshoring, automation, and AI to reduce costs and improve service delivery [10][30] - **Capital Allocation**: Plans to deploy capital for shareholder value generation, including share repurchases and M&A in the ambulatory space [11][55] Market Position and Client Retention - **Client Service**: Conifer's client service remains strong, with expectations to onboard new clients and redeploy resources effectively [14] - **Market Competitiveness**: Investments in technology and automation are aimed at reducing the cost to collect, enhancing Conifer's competitive position in the marketplace [22][30] Future Outlook - **2026 and Beyond**: - Continued focus on managing the existing contract with CommonSpirit while planning for future growth opportunities [62] - Anticipated changes in EBITDA for 2027, with ongoing assessments of resource redeployment and operational efficiency [63][64] Additional Important Insights - **AI and Automation Strategy**: Investments are not solely AI-focused but include a mix of automation and advanced analytics to improve workflow efficiency and reduce costs [41][42] - **Long-term Contract**: The contract with CommonSpirit began in 2012 and was set to run through 2032, indicating a long-term relationship prior to the recent transaction [46] This summary encapsulates the key discussions and insights from the Tenet Healthcare Analyst Conference Call, highlighting the company's strategic maneuvers, financial performance, and future outlook in the healthcare industry.